Back in September when the downgrades first started, economists warned that the country must do what it can to avoid falling further. That has not happened and unless there is a real change in the coming months, 2018 is going to be a tough year.

The full impact of junk stats will take a while take a while to be felt, but how will they impact you?

Let’s take a look….

Food prices could increase

With the sky-rocketing petrol price, food is where we’ll feel the impact of junk status most. Junk status impacts the exchange rate, which means imported goods or services will be more expensive and those extra costs will be passed onto the consumer. And that’s not just your fancy cheese – it could impact the cost of goods like maize, which the country has had to import due to drought.

Impact on services like social grants and health care

Credit ratings determine a country’s ability to borrow from foreign investors. If the credit rating is lower, it means the amount paid back through interest is higher. That leaves the country with less money to put towards service delivery and social services. With tax collection already an issue, this is likely to be a big problem.

Less disposable income and job security risks

Inflation is likely to increase while your salary probably won’t. That means you’ll have less cash for to pay for things that cost more. Jobs are also at risk which, in the long-run, will again impact government’s tax collection. But, add to that the fact that you’ll be paying more on tax if the government goes through with its plans to hike tax and you get the grim picture.

Interest rates could spike

Meaning you’ll pay more on your home loan and your personal loan, your car loan and your credit card. Once again, that leaves you with less money in the bank at the end of the month.